Principles of Economics and Market Dynamics Quiz

Explore key concepts in macroeconomics with our quiz. From supply and demand to market dynamics, test your understanding today!

Practice Learn Test

Which of the following best defines the law of demand?

As price increases, demand decreases

As price decreases, demand decreases

As price increases, demand increases

As price decreases, demand increases

What is the primary function of the Federal Reserve System in the United States?

Fiscal policy

Monetary policy

Trade policy

Industrial policy

Which of the following is a characteristic of a perfectly competitive market?

Many buyers and sellers, differentiated products

Many buyers and sellers, identical products

Few buyers and sellers, differentiated products

Few buyers and sellers, identical products

What is the concept of 'invisible hand' in economics often associated with?

Adam Smith

John Maynard Keynes

Karl Marx

David Ricardo

What is the role of the World Trade Organization (WTO) in international trade?

To regulate exchange rates between currencies

To provide financial aid to developing countries

To establish and enforce rules for international trade

To promote bilateral trade agreements between countries

What does GDP stand for?

General Domestic Product

Gross Domestic Profit

Gross Domestic Product

General Domestic Profit

Which of the following is a characteristic of monopolistic competition?

Many buyers and one seller

Few sellers and one buyer

Many sellers selling differentiated products

One seller and one buyer

What does the term 'opportunity cost' refer to in economics?

The total cost of producing a good or service

The cost of an alternative that must be forgone in order to pursue a certain action

The additional cost incurred when producing one more unit of a good or service

The monetary value of a good or service

What is the formula to calculate price elasticity of demand?

Percentage change in quantity demanded / Percentage change in price

Percentage change in price / Percentage change in quantity demanded

Absolute change in quantity demanded / Absolute change in price

Absolute change in price / Absolute change in quantity demanded

#10

What does the term 'supply curve' represent in economics?

The relationship between price and quantity demanded

The relationship between price and quantity supplied

The relationship between income and quantity demanded

The relationship between income and quantity supplied

#11

What is the Tragedy of the Commons?

A situation where individuals overuse or deplete a shared resource

A situation where individuals underuse a shared resource

A situation where individuals monopolize a shared resource

A situation where individuals do not have access to a shared resource

#12

Which of the following is NOT a component of aggregate demand?

Consumption

Investment

Government spending

Exports

#13

What is the concept of 'comparative advantage' in international trade?

The ability of one country to produce a good more efficiently than another country

The ability of one country to produce all goods more efficiently than another country

The ability of one country to produce a good at a lower opportunity cost than another country

The ability of one country to produce a good at a higher opportunity cost than another country

#14

What is the role of the International Monetary Fund (IMF) in the global economy?

To regulate international trade agreements

To provide loans and financial assistance to member countries

To promote economic development through foreign aid

To set standards for environmental protection in member countries

#15

What is the concept of 'scarcity' in economics?

The unlimited availability of resources to meet unlimited wants

The limited availability of resources to meet unlimited wants

The unlimited availability of resources to meet limited wants

The limited availability of resources to meet limited wants